LIVE MARKETS-NFIB: The Trump honeymoon's over already?
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NFIB: THE TRUMP HONEYMOON'S OVER ALREADY?
The mood of small business owners dimmed a bit last month, with the post-election honeymoon showing signs of fading during the very month President Donald Trump took the oath of office.
The National Federation of Independent Business' (NFIB) Optimism index USOPIN=ECI shed 2.3 points to a reading of 102.8.
Business expectations soured, the portion of respondents expecting an increase in sales dipped, and the percentage of survey participants planning capital outlays over the next six months slid 7 percentage points to 20%.
Most strikingly, the uncertainty component launched itself into the stratosphere, gaining 14 points to 100 - the third highest it's ever been.
"The fading optimism probably at least partly reflects worries about disruption caused by trade policy and perhaps some other aspects of Mr. Trump’s platform, such as sharp cuts to immigration," writes Oliver Allen, senior U.S. economist at Pantheon Macroeconomics.
On a positive note, a net 26% of respondents intend to raise prices, down two ppts from December, as did the percentage of those who consider inflation to be their most pressing problem.
"Our base case is that the ongoing loosening in the labor market will support a further decline in domestically generated inflation in the coming months," Allen adds, "although the tariffs and radical changes in immigration policy suggested by Mr. Trump might yet prevent the Fed from meeting its inflation target on a sustained basis this year.
It's worth noting that NFIB is a politically active membership organization whose PAC skews overwhelmingly Republican, according to the Center for Responsive Politics/opensecrets.org.
(Stephen Culp)
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